Outlaw all the tips confusion
The tipping debate drags on, but Michael Gottlieb has - he hopes - the last say.
Service charges, tips, gratuities, service included, not included, optional, voluntary or suggested this and that… I am fed up with this pointless debate that won't go away. Add to this the minimum wage and National Insurance contributions and how service charges or tips impact on them, and I start losing my will to live. So here is my final word on the matter.
Point 1. The customer always pays no matter how you look at it or what you call it.
Point 2. The difference between a service charge and a tip is illusory. The first makes it seem like you have no choice, when you do, and the second makes it seem like you have a choice when in practice you don't, since most people tip because they have to, not because they want to. Both can legally go straight to the server, both can legally be distributed to some or all of the staff in the restaurant, and both can legally be retained by the business.
Point 3. The differences between an optional or suggested gratuity, a "compulsory" service charge and a "voluntary" tip are moot to the customer, who always pays (see Point 1). In the first case, however, because of a tax loophole, the Exchequer is out of pocket, the restaurateur is better off, and the staff don't give a damn.
Point 4. Using tips or service charges to make up an employee's wages is not disgraceful. Staff will only work for a final net pay packet that they are happy with, and most don't care if it comes from tips, service charges, hourly rates, bonuses or any combination thereof, so long as the money is regular.
Point 5. Restaurants do not rely on customers' tips, service charges, etc, to pay their staff wages any more than they rely on those tips to pay their suppliers. They rely on tips for both. If customers never tipped or there were no service charges allowed, prices would have to go up to cover the shortfall to pay the staff and the suppliers. It all comes from the same pot, and that pot is always funded by the customer (Point 1).
Point 6. Tips or gratuities need not be the prime motivator for staff to perform well, if management know what they are doing. The US model of tipping is discredited - how else can you explain why service can be so lousy there on occasions?
Point 7. The system - or lack of one - is a mess: it encourages sharp practice (open credit-card slips when service is included); it confuses tourists and natives alike; and makes the simple pleasure of having a meal out unnecessarily complicated. Government legislation to abolish service charges and all their variants is the only way out. But, since everything the Government legislates on turns to dust, the industry must be allowed to draft the legislation if there is to be any chance of it working.
Now will you all please shut up.
Michael Gottlieb is president of the Restaurant Association and proprietor of Caf‚ Spice restaurants and Pencom (Service That Sells) UK
